BOARD AGENDA MEMORANDUM
Government Code § 84308 Applies: Yes ☐ No ☒
(If “YES” Complete Attachment A - Gov. Code § 84308)
SUBJECT: Title
Receive Report of Bids, Ratify Addenda, Approve the Contingency Fund, and Award the Construction Contract to Con-Quest Contractors, Inc., for the West Pipeline Inspection and Rehabilitation Project - Phase 1, as Part of the 10-Year Pipeline Inspection and Rehabilitation Project, Project No. 95084002, Contract No. C0705 (Town of Los Gatos, City of Campbell, City of Saratoga, City of Cupertino, City of Los Altos, and City of Santa Clara, Districts 4, 5, and 7).
End
RECOMMENDATION: Recommendation
A. Ratify Addenda No. 1,2, and 3 to the contract documents for the West Pipeline Inspection and Rehabilitation Project - Phase 1;
B. Award the Construction Contract to ConQuest Contractors, Inc., located in Burlingame, California in the sum of $12,488,800; and
C. Approve a contingency of 10% in the amount of $1,248,880 and authorize the Chief Executive Officer or designee to approve individual change orders up to the designated amount.
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SUMMARY:
The objective of the West Pipeline Inspection and Rehabilitation Project - Phase 1 (Project) is to increase the reliability and useful life of the pipeline.
The Project scope includes completely draining and removing all water from the West Pipeline in the section between Rinconada Water Treatment Plant and the Cox Line Valve, performing repairs on pipeline appurtenances, abandoning outfalls, replacing line valves, installing new line valves and vaults, providing support for a manned internal pipeline inspection, procuring long-lead material, installing supervisory control and data acquisition (SCADA) system components, installing corrosion protection systems, and performing internal pipeline repair work as identified during the inspections.
Project Background
The West Pipeline is included in Santa Clara Valley Water District’s (Valley Water) Pipeline Maintenance Program (PMP) and is an identified capital effort in the 10-Year Pipeline Inspection and Rehabilitation Project. The PMP defines the activities associated with maintenance and repair of water supply conveyance systems including pipelines, appurtenances, electrical systems, control systems, and structures, throughout Valley Water’s jurisdiction.
The purpose of the 10-Year Pipeline Inspection and Rehabilitation Project is to maintain the integrity of the approximately 150 miles of large diameter raw and treated water transmission pipelines, extend their useful life, and address infrastructure reliability concerns. Other projects completed as part of the 10-year Inspection and Rehabilitation Project include: Snell Pipeline, Santa Clara Conduit Rehabilitation & Pacheco Sectionalizing Vault Replacement, Almaden Valley Pipeline, Pacheco Conduit, Cross Valley and Calero Pipelines, and Central and Parallel East Pipelines.
West Pipeline
The West Pipeline (WPL) consists of approximately 9.1 linear miles of 84-inch to 30-inch welded steel pipe (WSP) and bar-wrapped pipe (BWP) with four distributary lines. It conveys treated water from the Rinconada Water Treatment Plant to various water retailers in multiple cities in the northwest corridor of Santa Clara Valley. The first segment of West Pipeline was constructed in 1965 and a second segment was constructed in 1967 to expand the service to Mountain View. The West Pipeline is owned and operated by Valley Water. It begins at Rinconada Water Treatment Plant, runs northwest primarily along the Union Pacific Railroad (UPRR) corridor, through the Town of Los Gatos, the cities of Campbell, Saratoga, Los Altos, Cupertino, and ends at Granger Turnout.
The West Pipeline will be inspected and rehabilitated in two phases. The first phase (this contract) covers the pipeline from Rinconada Water Treatment Plant to the Cox Line Valve. One additional line valve will be installed during this phase. Phase 2 is from the Cox Line Valve to the Granger Turnout with the installation of two additional line valves. The construction of Phase 1 of the Project is expected to be completed in October 2026 and is planned to transition to Phase 2 in November 2026.
Addenda Ratification
Three (3) addenda were issued during the bid advertisement period to clarify the Project Contract Documents and answer bidders’ questions. To formally incorporate the Addenda into the Project Contract Documents, staff recommends that the Board ratify the addenda.
West Pipeline Inspection and Rehabilitation Project - Phase 1 Specifications were provided by separate communication to the Board for their review prior to taking the recommended action to adopt the Plans and Specifications for bid advertisement. The addenda were also provided by separate communication to Valley Water’s Board of Directors for their review prior to taking the recommended action to ratify. To protect sensitive information related to the project, all parties interested in accessing the Plans and Specifications, and Addenda were registered as a vendor at the Valley Water Vendor Portal and submitted a completed Non-Disclosure Agreement (NDA) to access the Contract Documents.
Contract Award
A report of bids received at the bid opening for the Project on November 13, 2024 is summarized in Table 1, including the Engineer’s estimate for Project budgeting purposes (refer to the Financial Impact section).
The lowest responsible bid was submitted by Con-Quest Contractors, Inc. of Burlingame. The bid submitted by Con-Quest Contractors, Inc. is 43% below the Engineer’s estimate of $21,827,700. The Engineer's estimate, which was prepared by a professional cost estimator, included escalation costs for the procurement of construction materials and general conditions for contractors’ overhead and operational expenses which did not necessarily come into play for this procurement. Furthermore, Con-Quest’s experience on prior Valley Water inspection and rehabilitation projects and established relationships with manufacturers for pipeline construction materials contributed to significant savings related to the cost to deliver this Project.
Staff reviewed the bid proposal and recommends the Board award the Construction Contract to Con-Quest Contractors, Inc. as the responsible bidder, submitting the lowest responsive bid.
Table 1: Bid Summary
|
Contractor, Location |
Bid Price |
Award Amount |
|
Con-Quest Contractors, Inc., Burlingame |
$12,488,800 |
$12,488,800 |
|
Cratus, Inc., San Francisco |
$18,303,620 |
|
|
Mountain Cascade, Inc., Livermore |
$18,788,075 |
|
|
Engineer’s Estimate: $21,827,700 |
Contingency Funds
The Contract award sum for the Project is $12,488,800. To allow staff to quickly address unforeseen or changed site conditions and other unanticipated occurrences, without causing unnecessary delays or consequential costs to the Project, staff recommends the Board approve encumbering a contingency amount of $1,248,880 which amounts to 10% of the contract amount for the subject Project.
The above-contingency amount was estimated due to the known and unknown risks, such as:
1. Unforeseen internal conditions and field conditions that may be different from the baseline and as-built information used in preparation of the Project Contract Documents;
2. Unanticipated variances in quantities and cost of various lump sum items estimated in the Bid Proposal;
3. Coordination issues and risks associated with weather conditions; and
4. Coordination issues with operations and maintenance activities.
Approval of individual change orders for the Project will be subject to approval at the following designated amounts:
Engineering Unit Manager: $100,000
Deputy Operating Officer: $300,000
Chief Operating Officer $400,000
Assistant CEO $500,000
CEO: Up to the Total Amount of the Contingency
Relevant Prior Board Actions
On November 13, 2007 the Board certified the Pipeline Maintenance Program Environmental Impact Report (PMP EIR) and adopted the Mitigation Monitoring Plan.
On March 9, 2010, the Board adopted Resolution 10-24 specifying intent to consider undertaking the Project and setting the time and date for a Public Hearing on the Engineer’s Report for the subject Project.
On April 13, 2010, the Board held a Public Hearing and adopted Resolution 10-29 approving the PMP Engineer’s Report and approving the PMP.
On April 11, 2023, the Board considered Addendum No. 1 to the PMP EIR prior to adopting the plans and specifications and authorizing advertisement for bids for the Snell Pipeline Inspection and Rehabilitation Project.
On September 24,2024, the Board considered Addendum No. 2 to the PMP EIR prior to adopting the plans and specifications and authorizing advertisement for bids for the West Pipeline Inspection and Rehabilitation Project - Phase 1.
Outreach to Bidders
The Notice to Bidders was made available to Valley Water’s registered PlanetBids vendors with the appropriate classifications to perform the Work. Chambers of Commerce, plan rooms (Builder Exchanges), and Valley Water’s website were also used to solicit interest in the Project. Broader advertising efforts also included two placements of the Invitation to Bid in the San Jose Post-Record.
Small Business Program
This project was advertised incorporating the Small Business Enterprise (SBE) Outreach Program that establishes a small business subcontracting participation goal of at least 30 percent for non-SBE Bidders. The apparent low Bidder Con-Quest Contractors, Inc. is registered as a Small Business Enterprise and will perform 71% of the total contract while subcontracting 29% of the Work to five non-SBE subcontractors.
Right of Way
Valley Water staff will continue to negotiate for a temporary construction easement associated with the installation of a new critical line valve, which is designated in the contract as a supplemental bid item. This supplemental item will only be approved for construction after the easement has been acquired.
Regulatory Permits
Valley Water received a Lake Stream Alteration Agreement (LSAA) from the California Department of Fish and Wildlife in October 2024.
Staff received conditional right-of-way letters from the Town of Los Gatos, City of Saratoga, and City of Campbell. The final approved encroachment permits from these cities will be completed after the construction contract is awarded and issued prior to construction commencement.
Public Outreach
During construction, appropriate measures will be taken to minimize impacts associated with the Project, such as traffic, noise and dust. Residents and businesses in the Project area will be informed of construction impacts through multiple outreach strategies including social media such as Nextdoor and Facebook, mailers, and signs, and coordination with the Campbell Union Elementary School District, Town of Los Gatos, City of Campbell, and City of Saratoga. The construction Contract Documents include requirements and mitigations to minimize impacts to the public during construction.
Next Steps
If the Board approves the recommendations, staff will proceed with administering Project construction, which is anticipated to begin in December 2024 and be completed by September 2026.
ENVIRONMENTAL JUSTICE AND EQUITY IMPACT:
The Project has incorporated noise-mitigating measures into the design. Measures include requiring the contractor to install sound-mitigating panels and to adhere to stringent noise levels per City and County Regulations.
FINANCIAL IMPACT:
The West Pipeline Inspection and Rehabilitation Project - Phase 1 is part of the 10-Year Pipeline Inspection and Rehabilitation Project, Project No. 95084002. It is included in the Capital Improvement Program (CIP) Fiscal Year (FY) 2025-29 Five-Year Plan and in the FY 2024-25 Adopted Budget. The total cost for the recommended construction contract, including the change order contingency sum of $1,248,880 is $13,737,680, which does not change the overall Total Project Cost reflected in the CIP FY 2025-29 Five-Year Plan.
There are adequate funds budgeted in the West Pipeline Inspection and Rehabilitation Project - Phase 1 as part of the 10-Year Pipeline Inspection and Rehabilitation Project, Project No. 95084002 to encumber $11,000,000 in FY 2024-25 and $2,737,680 in FY 2025-26 for the planned construction expenditures.
The Project is funded by the Water Utility Enterprise Fund (Fund 61) with 95.89% of the costs of the 10- Year Pipeline Inspection and Rehabilitation Project allocated to Zone W-2 (North County), 3.16% to South County Zone W-5, 0.89% to South County Zone W-7, and 0.06% to South County Zone W-8.
CEQA:
On November 13, 2007, the Board certified an Environmental Impact Report for the Pipeline Maintenance Program (PMP EIR) (accessible via <https://fta.valleywater.org/dl/qRvvY7YPH2>). The PMP provides for the routine inspection, rehabilitation, and maintenance of Valley Water’s raw and treated water pipelines and evaluates the environmental impacts of the PMP activities. All proposed activities for the WPL Project have been evaluated relative to the PMP EIR, except for the construction of three new underground valves and vaults on the West Pipeline, which were not evaluated in the PMP EIR. During Project construction, Valley Water and its contractor will comply with all applicable BMPs and mitigation measures from the PMP EIR and permit conditions.
Pursuant to the California Environmental Quality Act (CEQA) Guidelines Section 15164, an addendum to a previously certified Environmental Impact Report (EIR) shall be prepared if some changes or additions are necessary but none of the conditions described in CEQA Guidelines Section 15162 (i.e., no new significant environmental effects or a substantial increase in the severity of previously identified effects) calling for the preparation of a Subsequent EIR have occurred. An Addendum No. 2 was prepared to evaluate the Project activities associated with construction of the three-line valves and vaults. The addendum shows that the proposed additional activities to construct the in-line valves and vaults will not result in new significant impacts or a substantial increase in severity of previously identified significant impacts. On September 24, 2024, the Board considered the addendum prior to adopting the plans and specifications and authorizing advertisement for bids for the Project.
ATTACHMENTS:
Attachment 1: Project Delivery Process Chart
Attachment 2: Project Overview Map
UNCLASSIFIED MANAGER: Manager
Emmanuel Aryee, 408-630-3074